HONG KONG, Oct 12 (IFR) - Asian credits were little changed on Thursday, though new issues rallied as regional stock markets continued to trade higher.
“The market has taken a breather after a recent rally, but sentiment remained constructive,” said a Hong Kong-based trader.
Long-dated notes of Chinese state-owned enterprises were barely changed today, after having tightened 7bp-8bp in the past two days on news of China’s upcoming offering of US$2bn sovereign US dollar bonds.
Natixis said in a research note that the Chinese government will issue more offshore US dollar sovereign bonds given the increasingly cheap offshore funding.
However, more importantly, it will help to create a benchmark, which will eventually help Chinese corporates reduce their offshore funding costs, Natixis has said.
The iTraxx Asia investment-grade index was 1bp tighter at 76bp/77bp.
New issues priced yesterday, from investment-grade to high yield and even Dim Sum bonds all traded well.
United Overseas Bank’s US$650m 3.875% perpetual non-call six AT1s traded up to 100.35/100.45.
China Singyes Solar Technologies’ US$160m 6.75% 364-day notes, priced at par, were quoted at 100.35/100.45.
Of the two newly priced Dim Sum bonds, BOC Aviation’s 4.5% 2020s gained 0.5 point to bid at 100.50, while BMW Finance’s 4.25% 2020s gained 0.25 point to bid at 100.25.
Reporting by Carol Chan; Editing by Dharsan Singh